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Departmental Public Expenditure

Volume 481: debated on Monday 27 October 2008

To ask the Secretary of State for Health what (a) private finance initiative and (b) local improvement finance trust schemes his Department is planning which are not yet operational; what the (i) monetary value of the contract and (ii) equity partners are in each case; and what his most recent assessment is of each such scheme's viability. (229467)

Information on private finance initiative (PFI) and local improvement finance trust (LIFT) schemes under construction (i.e. not yet operational) with their respective capital values and equity partners has been placed in the Library.

The LIFT schemes shown in the Library document are those currently under construction. The planning of LIFT schemes is a local responsibility, and while the Department is aware that many LIFT schemes are currently being planned, it does not hold a comprehensive record of these potential schemes.

PFI schemes in the planning stage, either actively preparing an initial outline business case or currently in procurement, are shown in the following table.

Commissioning body

OBC approved/to be approved

Estimated total capital value(£ millions)

Royal National Orthopaedic Hospital NHS Trust

2009

143

North Bristol/South Gloucestershire PCTs

May 2007 Financial close not expected within next 12 months

475

Southampton University Hospitals NHS Trust

End of 2008/ Beginning 2009

61

Sandwell and West Birmingham Acute NHS Trust

2009

368

West Hertfordshire Hospitals NHS Trust

2010

280

East and North Hertfordshire NHS Trust

2010

110

Papworth Hospitals NHS Foundation Trust

End of 2008/ beginning 2009

125

Royal Liverpool Children's Hospital NHS Trust

2009

235

Mersey Care NHS trust

2009

170

Royal Liverpool and Broadgreen University Hospitals NHS Trust

2009

477

Birmingham and Solihull MH Trust (Yardley Green)

2009

45

Once an NHS body has signed a PR or LIFT contract, the financial terms of the loan raised by the private sector consortium counterparty are set and fixed. The overall cost of the project to the NHS will not change (unless the NHS wants to make a change to its own requirements). PFI contracts deal comprehensively with the possibility of early termination due to contractor default, including through insolvency, in order to protect the public interest.

The Government's policy continues to be that PFI, LIFT and other public-private partnerships should be used to deliver public services when this offers value for money. This is assessed on a case by case basis at the appropriate approval point for each scheme.